Islamabad: The prices of cement and steel have risen significantly in the last year leading to a slowdown of construction activities in the country, the news sources reported on January 3.
As per the reports from manufacturers and distributors, there has been a steep rise of 41% in cement prices while steel prices have risen by almost 16% from December 2021 to December 2022. The overall price rise has also contributed towards a rise in construction costs and a slowdown in construction activities.
As per market research, the 50-kilogram cement bag rate rose to PKR 1,043 from PKR 738 on December 30, 2021, while per tonne steel bar prices increased to PKR 224,500-225,500 from PKR 194,500-197,500 a year ago. Steel bars, which hold a 40-45% share in the total cost of construction of a high-rise project, hit an all-time high at PKR 235,000 per tonne in June 2022.
Moreover, the steel manufacturers jacked steel bar prices three times in December 2022, the highest in a month. The massive rise in cement and steel bars has jacked up the construction cost of highrises and housing projects. Manufacturers and distributors have tied the price hike with the rising coal prices, power and diesel rates and general inflationary trend.
Similarly, as per the news report, cement exports have also decreased due to the winter season and post-flood situation, and construction activities have been affected. Local cement sales in December may fall by 13-17% year-on-year and 9-13% month-on-month.
It is important to note that the recent higher-than-normal FOREX exchange rates and the rising raw material cost have impacted the construction sector and slowed down growth in one of the largest sectors of the economy.
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